Key Financial Indicators and additional information
| Item | 2018 | 2017 | | |
| RUB mln | % | |||
| Total revenue | 76,959 | 65,567 | +11,392 | +17.4 |
| Other operating income | 1,486 | 647 | +839 | +129.7 |
| Operating expenses | (66,886) | (58,438) | (8,448) | +14.5 |
| Operating profit | 11,559 | 7,776 | +3,783 | +48.6 |
| Interest expenses | (885) | (634) | (251) | +39.6 |
| Interest income | 465 | 301 | +164 | +54.5 |
| Foreign exchange gain, net | 417 | (23) | +440 | |
| Share of result of associates and JVs | 268 | 704 | (436) | (61.9) |
| Other financial results, net | 154 | 48 | +106 | |
| Profit before income tax | 11,978 | 8,172 | +3,806 | +46.6 |
| Income tax expenses | (2,469) | (1,638) | (831) | +50.7 |
| Profit for the period | 9,509 | 6,534 | +2,975 | +45.5 |
| Other comprehensive income | 312 | (26) | +338 | |
| Remeasurements and other reserves for post-employment benefit plans | 117 | 102 | +15 | +14.7 |
| Exchange differences on translating foreign operations (TransContainer) | 49 | 14 | +35 | +250.0 |
| Exchange differences on translating foreign operations (subsidiaries and JVs) | 146 | (142) | +288 | |
| Other comprehensive income | 9,821 | 6,508 | +3,313 | +50.9 |
The majority of the Company’s services are provided with the use of third-party services. Accordingly, third-party charges for such services are presented within the Company’s revenues and expenses. In particular, such charges include the value of railway tariffs and the third-party charges related to principal activities.
All third-party services are presented as «Third-party charges related to principal activities».
| Item | 2018 | 2017 | | |
|---|---|---|---|---|
| RUB mln | % | |||
| Third-party charges related to integrated freight forwarding and logistics services | 45,671 | 35,805 | 9,866 | +27.6 |
| Cargo transportation and handling services with involvement of third parties | 0 | 1,980 | (1,980) | (100.0) |
| Third-party charges related to principal activities | 45,671 | 37,785 | +7,886 | +20.9 |
For analytical purposes, the Company includes the third parties’ share in the Company’s revenues and expenses.
| Item | 2018 | 2017 | | |
| RUB mln | % | |||
| Total revenue | 76,959 | 65,567 | +11,392 | +17.4 |
| Third-party charges related to principal activities | (45,671) | (37,785) | (7,886) | +20.9 |
| Adjusted revenue | 31,288 | 27,782 | +3,506 | +12.6 |
| Item | 2018 | 2017 | | |
| RUB mln | % | |||
| Integrated freight forwarding and logistics services | 71,158 | 57,052 | +14,106 | +24.7 |
| Third-party charges related to integrated freight forwarding and logistics services | (45,671) | (35,805) | (9,866) | +27.6 |
| Adjusted revenue related to integrated freight forwarding and logistics services | 25,487 | 21,247 | +4,240 | +20.0 |
| Item | 2018 | 2017 | | |
| RUB mln | % | |||
| Operating expenses | 66,886 | 58,438 | +8,448 | +14.5 |
| Third-party charges related to principal activities | (45,671) | (37,785) | (7,886) | +20.9 |
| Adjusted operating expenses | 21,215 | 20,653 | +562 | +2.7 |
Some items used, such as adjusted revenue, adjusted operating expenses, EBITDA, adjusted EBITDA margin and adjusted net profit margin, are not IFRS financial metrics and constitute supplementary indices of the Company’s operating activities. They are used as additional analytical tools with limited applicability, so they shall be used neither separately nor together instead of IFRS metrics.
The reporting period was generally characterised by a significant nonrecurrent effect related to the revenue from the fixed assets sales and disposals. Within this context, EBITDA was adjusted by the nonrecurrent effect value to represent the Company’s outcomes more precisely.
Total Revenue
The revenue structure in the reporting period includes three major categories: revenue from integrated freight forwarding and logistics services, agency fees and revenue from other activities. Such change is due to a noticeable increase in the freight forwarding and logistics services volume and the respective share in the Company’s total revenue.
Revenue from the agency fees was previously included in the revenue from terminal services, bonded warehousing services, and agency fees.
Revenue from other activities comprises revenues from rail container transportation, cargo transportation and handling services with involvement of third parties, truck deliveries, etc.
The Company’s revenue in 2018 increased by RUB 11,392 million, or 17.4% year-on-year, to RUB 76,959 million from RUB 65,567 million in 2017. Such revenue growth primarily resulted from an increase in transportation volumes by the Company’s assets, as well as terminal handling volumes on the back of the growing rail container transportation market. In 2018, the Company ramped up the provision of integrated freight forwarding and logistics services and stopped the provision of cargo transportation services with involvement of third parties.
The adjusted revenue breakdown in 2018 and 2017 respectively is shown in the table below.
The adjusted revenue increased in 2018 by 12,6% year-on-year to RUB 31,288 million from RUB 27,782 million in 2017. It reflects the growth of the integrated logistics services volume driven by a greater volume of revenue-generating transportation, as well as the flexible pricing policy.
Integrated Freight Forwarding and Logistics Services
Revenue from the integrated freight forwarding and logistics services increased by 24.7% to RUB 71,158 million over 2018.
Adjusted revenue from the integrated freight forwarding and logistics services was up by 20.0% year-on-year to RUB 25,487 million in 2018, mainly on the back of growing revenue-generating volumes and changing the customers’ preferences towards complex and integrated transportation services.
Agency Fees
The agency fees increased by 15% year-on-year to RUB 2,988 million in 2018 compared to RUB 2,597 million in 2017. This was primarily driven by tariff indexing and restructuring the services under the agency agreement with the Russian Railways.
Revenue from Other Activities
Revenue from other activities includes the revenue components previously allocated separately: revenue from rail-based container transportation, revenue from truck deliveries, revenue from cargo transportation and handling services with involvement of third parties, and revenue from other freight forwarding and logistics services.
In 2018, revenue from other services was down by 28.4% to RUB 2,813 million, compared to RUB 3,927 million in 2017. The decline was mainly due to customer demand to shift towards integrated transportation and logistics services.
Other Operating Income
In 2018, other operating income amounted to RUB 1,486 million compared to RUB 647 million in 2017. The growth was mainly due to the sale of Saint Petersburg-Tovarny-Vitebsky terminal in December 2018.